India’s agricultural output has “contracted” or shrunk by 2.2 per cent in the third quarter of 2008-09, posting a negative growth for the first time in the past two fiscal years, reports Zia Haq.

India’s agricultural output has “contracted” or shrunk by 2.2 per cent in the third quarter of 2008-09, posting a negative growth for the first time in the past two fiscal years. India’s farms are said to be insulated from the global meltdown, and economists also attribute to seasonal swings typical of agriculture and the “base effect” in comparison with last year’s solid show, but the shrinkage might have a link in the bigger picture.

“I am not alarmed nor surprised. You can get negative growth in a quarter, after an exceptionally good season,” farm economist Yoginder K. Alagh, who headed a landmark panel to fix assured prices for farmers, told HT.

Alagh said it has generally been a bad quarter for exports and that is why the current financial meltdown may have played a role. “This could be the beginning of the impact on global commodity crisis on the export of agriculture products.” Of the total agricultural production, 15 per cent is exported. “The slump in global commodity demand may have played a role,” Alagh said.

A decline in production of various Kharif crops pulled down the GDP to minus 2.2 per cent at baseline 1999-2000 prices during October-December. During the corresponding period in 2007-08, the agricultural GDP was a robust 6.9 per cent.

Alagh attributed the drop in output to “bad weather in some parts” and also spoke of “high projection made by Krishi Bhavan”. Figures released by the Central Statistical Organis- ation (CSO) showed that despite redoubling of the government’s efforts, farm output slid steadily from three per cent in the first quarter and 2.7 in the second, to minus 2.2 in the third.